Master the Market: Your Guide on How to Buy PayPal Stock (PYPL)

Highlights and Key Takeaways

• PYPL’s unique combinations of core payment solutions, significant potential for engagement growth, and positive progress on strategic transformation make it an ideal investment opportunity.

• Market competition and stagnation of individual user monetization pose potential risks for investors. 

• Choosing a broker, opening a brokerage account, and choosing an order option are the ways to place an order to buy PYPL.

• Investors can also invest in PYPL through index funds and ETFs. Keeping track of your investment and learning when to sell it can help you achieve your investment goals. 

Understanding PayPal As an Investment

PayPal is at the forefront of its industry. No other online payment application has achieved what PayPal has been able to pull off over the years. Starting off as the primary payment method for online sellers like eBay, this company has seen growth like no other. 

Although the stock did experience a freefall in price, analysts and investors alike see PayPal’s future as bright with a resurgence in the market. Investing in PayPal provides you exposure to:

• A well-established brand.

• Room for engagement growth.

• Positive progress on strategic transformation.

Why Invest in PayPal?

Before you learn how to invest in stocks, you need to understand why PayPal stock is worth investing in. You should always look for certain key features in any stock when looking to invest. These factors include the stock’s market position, growth potential, improved focus, and company’s financial strengths. PayPal provides you with most of these features in abundance. Here is a closer look:

With an improved focus, PayPal is now focusing on checkout platforms, PayPal and Venmo wallets, and Braintree processing. The improved focus means PayPal is now in a position to take full advantage of the booming e-commerce market by optimizing its core products. This means you can invest in PayPal, which has the potential to make more money from a diversified product portfolio and improved market focus.

Secondly, PayPal operates in a rapidly growing world of online commerce. Data shows the digital payments market will grow by 9.52% annually to $16.62 trillion by 2028. Therefore, there is a huge potential for PayPal to capture more transactions, providing you with the possibility to grow your fortunes in the future. 

Lastly, PayPal is making a comeback, with financial strengths backing up the stock. The company gained $5 billion in extra cash by the end of FY 2022, a year-over-year increase of 4% by working smarter, not harder, and by saving money. The company earned $27.5 billion in the same year, up 8% on spot and 10% on FX neutral basis. With PayPal’s flexibility in the market, it is expected to have a better FY 23, which is all the more reason the stock is expected to perform.

Risks Associated With Investing in PayPal

While PayPal ticks the boxes of an attractive stock, there could be notable risks investors should be aware of. One of PayPal’s primary risks is the stagnation in per-user monetization. The company’s approach is to lay off employees in order to save money for future expansion. However, this poses a risk in the long run. With fewer employees, the company can fail to meet customer demands and see a further decline in performance.

A potential loss of market share is also a drawback to the future performance of PayPal’s stock. Although the company remains a leader in online payments, smaller rivals like Apple Pay, Google Pay, and Amazon Pay are coming up and gaining a market of their own. Increased competition could impact PayPal’s revenues and adversely affect the future share price.

PayPal also carries volatility risks inherent in most growth companies. These stocks are characterized by sudden movements that, although beneficial, expose investors to uncertainty. As such, you need to play safe by understanding PayPal’s price movements and market trends so as not to fall victim to its high volatility.

How To Buy PayPal Stock

Once you have researched the potential of the PayPal market, its advantages for investing, and potential risks, you will be in a good position to buy PayPal stock. Here is a comprehensive guide that involves two key steps:

• Choosing a brokerage.

• Placing a stock order.

Choosing a Brokerage

The first step towards buying PayPal stock is to choose a broker. Brokers play the role of intermediaries between you and the stock market. If you are starting out, you may want to start with a broker that charges the least costs to maximize the potential return. The fee can be monthly or yearly, so make sure to compare the fees and their services to pick the one that suits your investment.

Another factor to keep in mind when choosing a broker is the user-friendliness of the platform. You should go for a broker that provides a mobile app and an interface that is easy to navigate, making your trading journey easier. 

Once you have chosen a broker, you will now need to open a brokerage account. Always trade stocks with the best stock broker that suits your investment and provides you with the benefits you are looking for. 

Placing a Stock Order

Once you have chosen a broker, opened an investment account, and studied the fundamentals of investing, you will then be ready to place your first order. Log in to your brokerage account and type in PYPL, which is PayPal’s stock symbol. 

Then, add the number of shares you want to buy. If you choose the market order as your choice, you will be able to buy the shares at the current price immediately. However, there is a second option available for you called the limit order. If you choose the limit order, you will only be able to buy the shares once the price reaches your desired amount or lower.

Monitoring Your Investment

 Monitoring investments involves tracking the performance of your stock and staying informed on the factors that could cause its price to change. Here is what you should focus on:

• Understanding stock performance.

• When to sell your stock.

Understanding Stock Performance

To understand stock performance, you should be able to read PYPL charts that provide valuable insights into the potential support, resistance levels, and trading volume of PYPL. Additionally, you will also need to look for trends in the key metrics to analyze growth potential by looking at the PYPL financial reports. 

Moreover, PYPL technical analysis will help you monitor the stock trend and make predictions based on price levels, demand and supply zones. Lastly, you will need to stay up-to-date on PYPL news to stay in tune with future developments. 

When To Sell Your Stock

One of the most important concepts in investing in stocks is being able to sell them at the perfect time. You need to look for a few signs that will tell you when it’s the right time to sell your PayPal stock. 

Firstly, when you have attained what you set out to achieve, it’s the perfect time to sell. Before investing, you had a profit target in mind; once that has been achieved, you can sell. The second factor to consider is PayPal’s fundamentals. If the company is deviating from its original policies, resulting in a decline in performance or potentially a loss in the near future, you should sell your stock.

How To Invest in PayPal With Funds

Buying individual shares of PayPal is not the only way to invest in its stock. You can also buy PayPal stocks through index funds and exchange-traded funds. These options provide you with instant diversification of your portfolio and broader market access. Read below to learn how to buy ETFs and index funds:

• Index funds are baskets of stocks that provide exposure to a range of companies and minimize risk.

• Exchange-traded funds (ETF) can be bought throughout the day and provide broader trading options.

• Both of these can be accessed through your online brokerage account. Trade an ETF with a regulated broker, and select the index funds and ETFs that contain PYPL. Compare different options and choose the one best suited for you. 

Conclusion

 PayPal is a market leader in digital payments and one poised to grow in the future. The growth means its stock is expected to increase in value, presenting an attractive investment. However, like other investments, PayPal is not without risks, with key concerns such as high volatility and potential decline in performance due to the company’s loss of market share.

As an investor, you need to analyze whether the potential for growth outweighs the risks. Once you decide to invest in PayPal, you will need to choose a broker, place an order, and monitor the performance of your investment. Always trade with a regulated broker to ensure the safety of your funds. Finally, sell your stock when your investment targets have been met or have every reason to believe the stock is set to underperform.

FAQ

How Can I Purchase PayPal Stock?

Start by choosing a broker and opening an investment account. Once that’s done, search for PYPL on the investment platform, choose the order option, and you can purchase the PayPal stock.

Does PayPal Pay Dividends?

No, PayPal does not pay dividends. 

Are PayPal Shares a Good Buy?

Yes, in September 2023, 44 analysts carried out a PYPL review. 14 of them rated it a strong buy, while 18 said it was a good buy. 

What Is the Best Stock To Buy Right Now?

Semler Scientific (SMLR) is the best stock to buy right now, and it’s rated 3.99/5.